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OPEC’s Barkindo says oil producers committed to maintain oil market stability

OPEC and other oil producers remained commited to maintain oil market stability beyond 2020 despite bearish signs of demand growth, OPEC Secretary General Mohammed Barkindo said Tuesday.

“The stability in the oil market will be sustained beyond 2020,” Barkindo told the India Energy Forum by CERAWeek in New Delhi. “All the producers are committed to this,” Barkindo said.

While acknowledging bearish views in the oil market supported by slowing oil demand growth, Barkindo said that fundamentals of oil market are showing some tightness.

“The physical market of oil is tight, meaning fundamental of oil is good,” Barkindo said.

OPEC, Russia and their allies have not ruled out deeper oil output cuts when they next meet December 5-6 in Vienna, the organization’s secretary general said on October 10, even as its analysis arm revised upward its forecasts of demand for the group’s crude this year and the next.

The current OPEC/non-OPEC supply accord commits the 24-country coalition to 1.2 million b/d in production cuts through March. Any decision made at the meeting would likely cover the entirety of 2020, he said then.

OPEC’s estimate of global demand for its crude this year was revised up by 100,000 b/d to 30.7 million b/d, which is 900,000 b/d lower than the 2018 level in its latest report.

For next year, OPEC revised up its estimate for the demand for OPEC crude by 200,000 b/d to 29.6 million b/d, around 1.2 million b/d lower than the 2019 level.

OPEC said it expects 2019 global oil demand growth of 980,000 b/d — 40,000 b/d less than last month’s forecast — but left its 2020 forecast unchanged from last month’s projection at 1.08 million b/d.
Source: Platts

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